MG Motors increases prices of HS, ZS models

Company unlikely to increase the price of newly launched PHEV

Morris Garages (MG) Motors Pakistan has increased the price of its MG ZS and MG HS Exclusive by up to Rs850,000.

The company said that the new prices of MG ZS and MG HS exclusive have taken effect from December 1 and December 6 respectively.

The development follows similar price hike announcements from other automobile companies in Pakistan.

The company has used different price increase criteria for both of its popular SUVs.

MG HS Exclusive

A notification from the company says that the new prices apply to all MG HS customers who have made a booking from December 6.

Customers who already booked the vehicle with full payment and partial payment before December 6 and the deliveries are due by December will pay an additional Rs200,000 and Rs500,000, respectively.

However, the rate of Rs850,000 will be applicable on all new orders made on December 6 and onward.

MG ZS and other models

MG ZS, the lowest priced model of MG Motors, will now be selling for Rs4.4 million after an increase of Rs300,000.

The new prices has taken effect from December 1.

The company hasn’t increased the price of its highest-priced model MG-HS eHS. This variant is available at Rs8.5 million. 

The company said that the price of MG HS PHEV is not expected to increase. However, an MG dealer said that the price may increase in January. Currently, it costs Rs6.25 million.

Association of Pakistan Motorcycle Assemblers (APMA) Chairperson Muhammad Sabir Shaikh said that the price of MG PHEV will also go up if the company receives good reviews from customers.

Why did MG car prices increase?

The company has so far been importing completely built units (CBU) from China and the costs of raw materials such as steel, chemical and aluminum have increased in the international market. Apart from that, the rupee has depreciated to Rs177.70.

“The chip price and sea freight charges also increased due to global shortage and post-pandemic congestion,” the company said.

Dealers said that the cost per container went up by $6,000 to $8,000, which has put pressure on the imports bill.

Market experts said that during Covid-19 pandemic, the car companies made a large number of orders out of the fear of lockdown. "When the lockdown was imposed in different countries, the containers were blocked, causing a container shortage in China and other exporting countries," an expert says.

Analysts said that the demand for cars has increased and the car companies have to increase the price due to global price increase.

How will the price hike impact sales?

Most of the dealers said that the price hike will not impact the company’s sales since potential customers of MG Motors can afford the vehicles even if the prices go up significantly. 

The company said in a notification that they had delivered 10,000 units till date despite the cost increase due to dollar appreciation, high sea freight charges and high chip price.

However, some dealers said that investors may cancel the bookings though the customers who purchase cars for their personal use may not opt for cancellation due to an increase in the car prices.

One of the dealers said that he hasn’t received any order cancellation requests yet but customers may cancel the orders in the next 15 days.

Shaikh said that the demand for cars increases in January every year as different companies such as banks, insurance companies and other multinational companies purchase cars for their employees.

Shaikh said that the own-money on MG cars was Rs500,000 a few days ago but when companies increase car prices, dealers reduce or abolish own-money for some time so that they don’t lose customers.

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